Hasbro 3Q results climb, helped by tax adjustment
Posted at: 10/21/2013 8:35 AM
(AP) PAWTUCKET, R.I. - Hasbro’s third-quarter net income rose 17 percent, buoyed by a favorable tax adjustment, higher international sales and strength in girls’ toys domestically.
Results beat expectations and shares jumped 8 percent in morning trading.
Toy sales overall have been weak in North America, Europe and Australia, due to a weak video game market, an uncertain economy and continued popularity of electronic gadgets like smartphones and tablets. Hasbro’s revenue rose just 2 percent. Sales were strongest in the girls’ category, led by My Little Pony. Revenue from games also rose, while sales in the boys’ category fell and preschool sales slipped.
The quarterly results come as toy makers gear up for the holiday season, which can account for up to half their annual revenue.
"Our brand initiatives for holiday 2013 are resonating with consumers and retailers globally as we enter the all-important fourth quarter," said CEO Brian Goldner.
The No. 2 toy maker earned $193 million, or $1.46 per share, for the three months ended Sept. 29. That compares with $164.9 million, or $1.24 per share, a year earlier.
Excluding 18 cents per share for the tax adjustment and restructuring and pension charges of 3 cents per share, earnings were $1.31 per share. Analysts polled by FactSet expected adjusted earnings of $1.30 per share, on average.
Revenue for the Pawtucket, R.I., company rose 2 percent to $1.37 billion on strong sales overseas and in its girls category and entertainment and licensing segment. Wall Street was calling for revenue of $1.35 billion.
By category, Hasbro reported its strongest sales in the girls category _ which was up 29 percent on the successful debut of My Little Pony Equestria Girls as well as the debut of Nerf Rebelle and increased sales of Furby and other My Little Pony products.
In the boys category, sales dropped 17 percent as the Marvel and Beyblade brands faced tough year-ago comparisons. There were increased sales of Transformers and Star Wars products.
International sales increased 11 percent, helped by favorable foreign exchange rates and better sales in Europe, Latin America and the Asia Pacific region. Hasbro said that sales in the games, girls and preschool categories climbed overseas.
Larger rival Mattel last week reported its net income rose 16 percent as revenue rose 6 percent to $2.21 billion, boosted by sales of dolls like Barbie and Monster High.
Shares rose $4.02, or 8.5 percent, to $51.24 in morning trading, after earlier trading at a 52-week high of $51.55. The stock had traded between $34.91 and $51.55 over the past year.
(Copyright 2013 by The Associated Press. All Rights Reserved.)